Digital Mortgage Technology Vocabulary: 10 Terms to Know

The introduction of remote online notarization (RON) and digital mortgage technology revolutionized residential mortgage and real estate closings and has amassed widespread support from homeowners, title and settlement agents, lenders, and loan servicers alike. 

According to a 2022 ALTA Digital Closing Survey, 62% of companies offering RON believe eClosing will increase in the next year. Additionally, 77% of the surveyed title professionals agree that lender, real estate agent, and consumer requests to use RON will speed up technology adoption in the mortgage industry. 

As the support and demand for digital mortgage technology grows, it’s important to get comfortable with new tech-driven terminology. A deep understanding of digital mortgage technology terms will position you as a modern mortgage-based business, help you remain a valued resource to your clients, and ensure you stay competitive in the changing residential mortgage landscape. 

Why a strong digital mortgage technology vocabulary is important to your business

A solid understanding of digital mortgage terms stretches beyond keeping up with the competition. Taking the time to familiarize yourself with new definitions helps you understand changes in the industry, including new regulations and industry standards and those driven by consumer demand. A firm grasp of digital mortgage vocabulary also allows you to confidently introduce and communicate new service offerings and options with partners, colleagues, and customers. 

Getting a quick handle on new terms and phrases may seem easy enough. However, when it comes to comprehending digital mortgage definitions, it's anything but simple. For one, digital mortgages are still emerging, and conflicting and complicated terms are circulating in the industry today. To combat the confusion, we created a simple glossary of the .

What is digital mortgage technology vocabulary?

Digital mortgage technology vocabulary is the set of words used to explain the technology and terms associated with digital closing, loss mitigation, and loan modifications in the mortgage industry. We’ve listed ten of the most critical terms and definitions below to get you started.

10 digital mortgage technology terms to know

Digital mortgage

A digital mortgage, also known as an electronic mortgage or eMortgage, is a mortgage loan in which some or all of the processes for applying, qualifying, and closing the loan are completed using a digital platform or electronic system instead of the traditional paper-based method.

Knowledge-based authentication (KBA)

Knowledge-based authentication (KBA) is a form of digital identity proofing that requires the signer(s) to provide information about themselves, such as former addresses or aliases. 

In-person electronic notarization (IPEN)

In-person electronic notarization (IPEN) is a type of notarization where documents are signed and notarized electronically. IPEN requires the signer and notary to be together in the same physical location.

RON Provider

A RON provider or partner is a company that offers a product or platform to facilitate remote online notarization. In addition to RON provider, you may hear terms like RON service provider, RON technology provider, RON software provider, RON vendor, RON servicer, RON platform, and RON software.

eNote

An electronic note, or eNote, is a promissory note created, accessed, signed, transferred, and stored electronically. Like a paper promissory note, an eNote is a binding agreement between the homeowner and lender and includes the terms of repayment for a loan, such as the interest rate, loan term, and final loan amount. 

eVault

An electronic vault, or eVault, provides secure storage for eNotes, including the authoritative copy of an eNote and other related data and documents. An eVault enables lenders, servicers, investors, and other secured parties to access, view, and transfer ownership of an eNote without printing or shipping paper. An eVault also allows stakeholders to interact with the eRegistry to transfer control and the location of an original eNote if needed.

eClosing

An eClosing, or electronic closing, is the digital approach to a traditional closing where some or all closing documents are executed and accessed electronically.

Hybrid closing

A hybrid closing occurs when a homeowner signs some of the required loan closing documents using pen and paper and the rest by applying an electronic signature.

Electronic notary

An electronic notary is a notary commissioned by the state to substantiate and apply an electronic notarial seal to electronic documents. The electronic notary performs the same function on electronic documents as a traditional notary does on paper. The only difference is the electronic notary performs the notarization digitally instead of physically on paper.

Electronic notarization (eNotarization)

Electronic notarization (eNotarization) occurs when a notary notarizes an electronic signature and then affixes an electronic signature and a digital notary seal to an electronic document.

Tips for increasing your digital mortgage technology vocabulary 

While the best way to increase your digital mortgage technology vocabulary is to use the terms regularly in conversation and correspondence, there are additional ways to stay up to date without copious studying or effort.

1. Keep an open mind to digital transformation in the mortgage industry

Increasing your vocabulary can be as simple as keeping an open mind regarding new terms and digital shifts in the residential mortgage and real estate industries. Embracing change can help you stay ahead of the competition, deliver the experience your clients want, and ensure you have a robust knowledge of invaluable industry terms.

2. Read digital mortgage-related articles and blog posts 

Another way to increase your vocabulary is by reading industry-related articles. Trade publications contain interesting real estate and lending articles that utilize relevant digital mortgage terminology. We've pulled a few recommendations below if you’re unsure where to start.

• Which mortgage tech advancements are making the biggest impact?
• Digitization is the future of mortgages-are you ready?

We also have a variety of educational articles on the Stavvy blog that can help you become more comfortable with digital mortgage terminology, including:

• Digital transformation in residential lending
• Millennials and the consumer demand for options in real estate transactions
• Where we stand with RON (remote online notarization)

3. Listen to digital mortgage and industry-related podcasts

If you prefer listening to reading, industry-related podcasts are another great way to increase your vocabulary. Real estate podcasts focusing on digital mortgage and digital transformation can expose you to new concepts and industry changes, effortlessly increasing your understanding of the changing landscape and preparing you for the future. Some of Stavvy’s favorite podcast episodes include:

• How digital mortgage technology enables humans in loan origination
• Making electronic mortgage closings the new norm
• How technology has transformed loan servicing
• Mortgage closings and data sensitivity

4. Write down digital mortgage terms you don’t know and look them up in a glossary

As you read, listen, or get involved in more digital mortgage conversations and business decisions, take note of any words or phrases you don’t understand. Afterward, look them up in a  digital mortgage glossary. If the terms and concepts you’ve jotted down are more technical or legal, you may need to reference vetted industry resources, like MISMO®, or connect with secondary market and title insurance underwriting contacts, for additional clarity.

Learning something new is not always comfortable at first, but by challenging yourself to use new terms in your day-to-day work life, you’ll be a digital mortgage expert in no time.